Clear Money Guide
What this guide covers
A quick view of the questions and evidence developed below.
Updated August 3, 2026. Quick answer: the question that exposes an unsuitable annuity replacement is “have I exchanged an annuity in the last 36 months?” FINRA’s own rule makes that a factor a firm must consider — it is the regulator’s built-in churning flag, and you can check it yourself.
What FINRA Rule 2330(b)(1)(B) requires
Before recommending an exchange, a firm must have a reasonable basis to believe it is suitable, taking into account whether:
“the customer would incur a surrender charge, be subject to the commencement of a new surrender period, lose existing benefits (such as death, living, or other contractual benefits), or be subject to increased fees or charges (such as mortality and expense fees, investment advisory fees, or charges for riders and similar product enhancements)”
Read the list as a description of what a bad replacement does to you, because that is what it is: you pay to leave, you restart a fresh lock-up, you lose benefits you already paid for, and your ongoing costs may rise — three or four separate harms in one transaction, while the person recommending it may be compensated again.
The 36-month flag
The rule requires considering whether “the customer has had another deferred variable annuity exchange within the preceding 36 months”
And Supplementary Material .05 requires the firm to make reasonable efforts to ascertain whether the customer has had an exchange at any other broker-dealer within the preceding 36 months, and to document the inquiry.
So a firm is expected to ask whether you have done this before, including at another firm, and to write down that it asked. If you have been moved between annuity contracts more than once in three years, that is precisely the pattern the rule exists to catch. It is a question you can ask about your own history in one phone call.
A second person is supposed to have signed this off
“A registered principal shall approve the recommended transaction only if he or she has determined that there is a reasonable basis to believe that the transaction would be suitable based on the factors delineated in paragraph (b) of this Rule.”
That is a named individual’s judgment on the record, and it is reasonable to ask whether the principal review happened and on what basis.
Deciding what to do with a contract you already hold
What the contract does is one question; whether to keep it, change it or move on, and what happens to the money either way, is another, and an adviser can work through that with you.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide is paid when you submit the form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
The Kapitalwise form opens here. You stay on this page.
What happens when you press the button
It asks about nine questions (age, investable assets, location), then your name, email and phone number, and verifies the phone by text. Nothing loads and nothing reaches Kapitalwise until you press the button. Submitting the form does not guarantee an adviser or a match. This matching form is not tax or legal advice. Submitting the form does not guarantee an adviser or a match. This matching form is not tax or legal advice.
What this page is not saying
Replacing an annuity is not automatically wrong, and annuities are not automatically bad. A replacement can be genuinely better — the rule itself contemplates the customer benefiting from product enhancements and improvements. The point is that the benefit has to outweigh the costs listed above, and those costs are concrete and calculable while the benefit is often described in general terms.
If you already own one and are wondering what to do with it, the decision is a separate question from whether you were sold it well: keeping versus exiting and what surrendering actually costs.
If the contract in question was inherited rather than bought, the decision is a different one — the payout routes on an inherited annuity, and whether the ten-year rule reaches it at all.
Where to raise it
FINRA takes complaints about brokers and firms and runs dispute resolution — and unlike the purely statistical fraud-reporting channels, that route can produce actual restitution. Which report does what.
General information drawn from federal regulator and law-enforcement publications, not legal or investment advice. This page describes patterns reported by regulators; it does not accuse any company or person of wrongdoing. Sources and read dates are given so you can check them yourself.